A number of financial stocks were down today after Goldman Sachs (NYSE:GS) lowered estimates for a number of them, including Bank of America (NYSE:BAC), JPMorgan Chase (NYSE:JPM) and Morgan Stanley (NYSE:MS).
Goldman based lowering its estimates on the financial institutions February results, which revealed earnings for 2010 dropping. Weak capital markets were another significant factor in the lowered estimates.
Cutting estimates in the first quarter for many of the investment banks and larger banks by an average of 15 percent and annual earnings by 3 percent, Goldman analysts said in a note to clients, “In general, while we continue to have a positive view on the direction of capital markets activity, lower-than-expected February results are likely to soften what otherwise would have been solid first quarter results.”
Estimates on Morgan Stanley were slashed by 16 cents on quarterly earnings to 55 cents a share for the quarter ending in March and 5 cents a share for annual earnings, which now stand at $2.95 a share.
Bank of America had estimates dropped by 2 cents for the same quarter, now expected to finish at 10 cents a share, while earnings a share for the year are at $1 now, a 5 cent a share drop.
For J.P. Morgan Chase, they had their quarterly earnings cut by 4 cents for the quarter to 70 cents a share and annual earnings dropped 5 cents to $3.25 cents a share on the year.
Goldman was especially concerned over Morgan Stanley and Citigroup (NYSE:C), which in their estimation haven’t taking advantage of what is trending now in the way their competitors have.
Goldman says commodities, currencies and fixed income should do well in 2010.
